WS #2045

The Strait of Hormuz crisis intensifies with new developments that could significantly impact energy markets and global stability. Iran has reportedly started charging for safe passage through the Strait, with one company paying £2 million, directly threatening oil supply routes and potentially spiking prices. This is corroborated by multiple sources including Financial Times reports and discussions of naval mine usage, heightening supply disruption risks. Concurrently, Saudi Arabia warns oil could spike to $180 if the energy shock persists past April, adding upward pressure on crude prices. However, counter-signals emerge as European powers (Britain, France, Germany, Italy, Netherlands, Japan, Canada) issue a joint statement calling for an immediate moratorium on attacks and express readiness to help secure the chokepoint, while Bloomberg reports European gas falls as US and Israel seek to ease Iran war concerns, suggesting potential diplomatic efforts to mitigate the crisis. Corporate and policy developments provide mixed signals. Tesla is in talks for a $2.9 billion solar equipment purchase from China, a bullish move for TSLA and renewable energy sectors amid the fossil fuel turmoil. Nvidia announces AI inference advancements at GTC 2026, projecting trillion-plus value by 2027, supporting NVDA's growth narrative. The IEA continues recommending demand-side measures like remote work and public transport use to conserve oil, indicating expectations of prolonged disruption. ECB's Villeroy reiterates the bank's vigilance and ability to act as necessary, providing policy stability against economic uncertainty from the Iran war. Traders have trimmed BOE rate wagers, pricing 65bps of hikes by year-end, reflecting adjusted monetary policy expectations amid the crisis.